April 11 (Bloomberg) -- Republican Party Chairman Reince
Priebus has less than 19 months before his next major test, the
2014 elections, to turn around a party with a tarnished brand,
skeptical consumers, revenue challenges and internal divisions.

“Their brand is frozen back in time, and today’s voters
are not buying it,” said Karen Post, an author on rebranding
who calls herself a “moderate” Republican. “Consumers have
changed. Parties that win reflect contemporary values.”

Priebus meets today and tomorrow in Los Angeles with the
equivalent of his sales team -- members of the Republican
National Committee -- for the first time since releasing a
report highly critical of the party and its 2012 election
efforts. He must convince them to live by the report’s
recommendations -- something that has already proved difficult.

The party’s “Growth and Opportunity Project” report,
released March 18, called for a more inclusive tone when dealing
with those who disagree with the Republican platform on abortion
rights and same-sex marriage. Yet, since the report’s
distribution, two RNC members and a Republican member of
Congress have triggered controversies because of rhetoric that
didn’t follow that recommendation.

Dave Agema, a Michigan RNC member, suggested that being gay
is an unhealthy lifestyle as part of his posting on Facebook of
another man’s article that called homosexuality “filthy.”
Agema defended the posting as useful at a time that the U.S.
Supreme Court is considering same-sex marriage cases, a position
that has prompted calls for his resignation from some Michigan
Republicans and critical statements from others.

Traditional Marriage

“Our party remains in support of traditional marriage but
that should never be allowed nor confused with any form of hate
or discrimination toward anyone,” Michigan Republican Party
Chairman Bobby Schostak said in a statement.

Agema has rebuffed the calls for his resignation.

Priebus and other party leaders, including House Speaker
John Boehner of Ohio, also condemned remarks by Representative
Don Young of Alaska, who used an ethnic slur to talk about
Hispanics his father hired to work on his California ranch
decades ago. Young apologized for his comment.

And the leader of Georgia’s Republican Party, Sue Everhart,
drew criticism from Democrats when she suggested that legalizing
same-sex marriage might trigger benefits and insurance fraud by
heterosexuals claiming to be gay.

Terri Lynn Land, an RNC member from Michigan, said the
controversy in her state over Agema’s Facebook post serves as a
reminder of the challenge Priebus faces.

Moving Forward

“We have to keep a respectful tone,” she said. “You just
have to keep moving forward and respond when you have to
respond.”

Priebus has fewer weapons at his disposal to enforce the
party’s will than did prior chairmen. Fundraising, grass-roots
organizing and turnout operations have increasingly been farmed
out or overtaken by outside entities such as super political
action committees, as is the case for Democrats.

Polling shows the depth of the Republican challenges. While
both parties have relatively low approval ratings, Republicans
are viewed more unfavorably these days than Democrats.

A CNN/ORC International poll released March 18 showed 54
percent of Americans have an unfavorable view of the Republican
Party, compared with 48 percent for the Democratic Party. Two-thirds said Republicans favor the rich, and nearly half think
the party’s policies are too extreme.

Internal Discontent

A Gallup poll conducted March 20-21 showed one in five
Americans, when asked to say what they most dislike about the
party, think the Republicans are too inflexible and unwilling to
compromise. The number is even higher -- 26 percent -- among
registered Republicans, highlighting displeasure within the
party.

Although changes to policy positions held by the party
weren’t the focus of the Priebus post-election report, it did
call for Republicans to “embrace and champion comprehensive”
revisions to immigration law to improve their image with
Hispanics, the nation’s fastest growing voting bloc. “If we do
not, our party’s appeal will continue to shrink to its core
constituencies only,” the report said.

Ahead of today’s gathering, Priebus announced that the
party was hiring two Asians to work toward better reaching out
to a population that gave Obama 73 percent of the 2012 vote.
Additional hires of Hispanics and blacks are also expected to be
announced this week.

Become Relevant

Post, the author on branding, said that for Republicans to
change voter attitudes and appeal to a broader base they’ll need
to show evidence of being a new and “relevant” party.

“They need some new rock stars that are visible and look
like this broader base,” she said.

Yet amid the calls for change, RNC leaders are also moving
to reassure the party’s base that they don’t intend to change
bedrock tenets. Land said the RNC’s Resolutions Committee will
consider a document affirming the party’s platform core values,
including the “sanctity of human life,” the right to keep and
bear arms and that marriage should be between a man and woman.

The meeting attendees will also address a simmering dispute
over rule changes implemented last year by 2012 presidential
nominee Mitt Romney’s campaign that made it harder for grass-roots activists at state conventions to influence the outcomes
of primaries and caucuses in their states.

The changes, spearheaded by Romney attorney Ben Ginsberg,
were in response to efforts by supporters of presidential
candidate and now former congressman Ron Paul of Texas to secure
delegates at state conventions.

Activist Complaints

Republican activists have continued to complain about the
changes because they have been viewed by some, including RNC
member Morton Blackwell of Virginia, as a power grab by the
national committee and party apparatus.

Blackwell was among more than 60 Republican leaders and
activists who signed an April 8 letter to Priebus urging him to
jettison the changes. Others who signed included the heads of
several Washington-based advocacy groups, including Tony
Perkins, president of the anti-gay-marriage Family Research
Council; Grover Norquist, president of anti-government-spending
Americans for Tax Reform, and Al Cardenas, chairman of the
American Conservative Union, an umbrella organization for
Republican groups.

Rules Changes

“Enacting rules changes that centrally consolidate power
not only violates our political principles, it will alienate the
very people who have been the most loyal foot soldiers in
support of Republican candidates,” the letter said.

In a vote late yesterday, the RNC’s Rules Committee removed
a requirement that the winner of a state caucus or primary
automatically gets to control its delegates, said RNC
spokeswoman Kirsten Kukowski. The measure, which also states
that presidential candidates don’t have the power to remove a
delegate, still needs approval from the full RNC tomorrow. The
amendment would ensure that state parties and grass-roots
activists remain the base of power to pick the Republican
nominee.

Democrats are closely watching Republican efforts to
rehabilitate their party. In an interview in Bloomberg’s
Washington Bureau on March 27, Jim Messina, President Barack
Obama’s 2012 campaign manager, said Republicans won’t find
success until they change their policy positions.

“We didn’t win because we had tech and data,” Messina
said. “We increased our margin and we probably won a couple
states, but we won because people sided with Barack Obama on the
issues and people made a decision to move towards him.”